Royal Dutch Shell Sells More Nigerian Assets

An area of the Niger River Delta devastated as a result of oil spills,
many of which were caused by oil thieves.
Violence and rampant oil theft in the region have recently led
 foreign oil giants to sell off their assets to smaller players.AGENCE FRANCE-PRESSE/GETTY IMAGES

Royal Dutch Shell PLC said Tuesday it has signed agreements to sell all of the Nigerian oil assets it put up for sale last year, the latest move by the Anglo-Dutch oil major to reduce its exposure to the West African nation.

A spokesman for Anglo-Dutch oil giant Shell said it—along with Italy’s Eni SpA and France’s Total SA —have signed an agreement to sell a 45% stake in Oil Mining Lease 18 to a consortium that includes Canadian company Mart Resources Inc. The terms of the deal weren’t disclosed.

The remaining 55% interest in the block—which produces up to 30,000 barrels a day—will be retained by the Nigerian National Petroleum Corp., Mart Resources said in a statement. The acquisition is subject to numerous terms and conditions including receipt of Nigerian government approval, it added.

Shell has now made sale and purchase agreements for four oil blocks, including OML 18. It has also made a sale and purchase agreement for the Nembe Creek Trunk Line, an oil pipeline, it said in a statement to The Wall Street Journal, although the sales process hasn’t yet concluded.

Violence and rampant oil theft in the Niger Delta have recently led foreign oil giants to sell their blocks to smaller players, many of them Nigerian.

Shell has been working for months to sell several of its onshore Nigerian holdings which for many years have been plagued by leaks stemming largely from oil theft.

Shell has agreed to sell another productive Nigerian oil block, known as Oil Mining License 29, and an associated pipeline, to a consortium comprised of three upstart local firms Taleveras Group, Aiteo Energy and Tempo Energy for more than $2.5 billion, said three people familiar with the matter.

According to one of the people, an agreement between Shell and the consortium was signed in London earlier this year, but the deal still requires final approval from Nigeria’s oil minister to conclude.

OML 29 is the largest of the southern Niger Delta assets that Shell put up for auction last year.

The companies in the consortium didn’t respond to requests for comment. Shell declined to comment on this particular transaction.

In July, U.S. company ConocoPhillips completed the sale of Nigerian oil assets to local player Oando PLC for $1.5 billion.

Source: The Wall Street Journal